A survey held by market intelligence platforms AMI and EchoMR with over 2,000 Internet-using adults in Latin America showed the new habits of online consumers amid the pandemic across Brazil, Mexico, and Colombia.
The results, broadcasted this Thursday in a webinar hosted by AMI, pointed out that about 20% of those surveyed in Mexico and Colombia made their first e-commerce transaction during quarantines, while, in Brazil, 59% of online consumers increased their e-commerce activity in this period, as they bought products online that they previously only purchased through traditional retail channels.
“Now is a pivotal moment to help consumers redefine their priorities and their brand loyalty,” says John Price, managing director at AMI. According to the study, emotional metrics, such as fear of health risks as well as income concerns are playing out an important role on how the Latin American consumer behavior is being impacted by the pandemic. 78% of respondents claimed to fear health risks and 84%, loss of income.
“People don’t envision themselves going back to restaurants, but they envision themselves eating at home and asking take-out food. This will be a paradigm shift,” explains Price. AMI and EchoMR’s survey categorized online consumers in five segments:
- Newbies – made their first online purchase during quarantine;
- Retreaters – online share of regular purchases has gone down during quarantine;
- Maintainers – online share of regular purchases has remained the same down during quarantine;
- Adapters – online share of regular purchases has increased a little
- Disruptors – online share of regular purchases has increased a lot
According to John Holcombe, SVP Latin American Research at Echo-MR, adapters, newbies, and specially disruptors are the ones that have the potential to change the e-commerce sector in Latin America. “These newbies are interesting cause they are often female, informal workers, that consume informally. They weren’t engaged digitally and now are. Their purchases are being driven by necessity,” he stresses. “Newbies are now the focus of attention of marketers who have been waiting for these markets [Mexico and Colombia] to catch up to Brazil.”
From ordering food delivery to shopping general products, the share of regular purchases made by an online population of 21% increased from a previous 40% to 53% after quarantines, excluding the usage of services like Uber and Netflix. The highlight, however, came from the category represented by newbies, as 21% of the online population went from 0% regular purchases made online to 28%.
Categories like health and life insurance, as well as internet service at home, pushed by the growth of remote work, are gaining ground, driven by a more cautious consumer. “The desire for outbound travel especially among Millenials were eclipsed by the fear of travel. This reality is much more pragmatic,” AMI expert pointed out. According to Price, it is in this scenario that holidays and business’ trips by car will grow.
“With this expansion of the digitization of society, people who avoided the digital world are now forced to embrace it. Even people without a banking account are arranging a manner to do e-commerce, as there are more and more tools available,” says the executive from AMI. “There are 30 million new e-commerce customers in Latin America this year. A lot of these people have adopted new payment methods – it’s an expansion of the payment pyramid.”
According to the study, the pandemic plays out a change in the ranking of most important products for Latin Americans, with connectivity and health and economic security becoming priorities.